ATTAI v. DELIVERY DUDES, LLC et al
Filing
32
ORDER granting 12 Motion to Dismiss and, Alternatively Motion for More Definite Statement; granting 23 Motion to Dismiss or, Alternatively, Motion for More Definite Statement. Plaintiff Justin Attai shall submit an amended pleading that complies with the guidance provided in this Order on or before March 14, 2016. (Amended Pleadings due by 3/14/2016). Signed by Judge Beth Bloom on 3/2/2016. (mc)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 15-CIV-62522-BLOOM/Valle
JUSTIN ATTAI, on behalf of himself and all
others similarly situated,
Plaintiffs,
v.
DELIVERY DUDES, LLC, et al.,
Defendants.
____________________________________/
ORDER GRANTING MOTIONS TO DISMISS
This cause is before the Court upon Defendant Jayson Koss’s Motion to Dismiss and,
Alternatively, Motion for More Definite Statement, ECF No. [12] (the “Motion”), and
Defendants, Delivery Dudes, LLC, Delivery Dudes Franchise Systems, LLC, and Dude
Holdings, LLC’s Motion to Dismiss or, Alternatively, Motion for More Definite Statement, ECF
No. [23] (collectively, the “Motions”).1 The Court has considered the Motions, all supporting
and opposing filings, Plaintiff Justin Attai’s Complaint, ECF No. [1], the record in this case, and
is otherwise fully advised. For the following reasons, the Motions are granted.
I. BACKGROUND
Plaintiff Justin Attai (“Plaintiff”) commenced this action against three corporate entities,
Defendants Delivery Dudes, LLC, Delivery Dudes Franchise Systems, LLC, and Dude Holdings,
LLC (the “Corporate Defendants”), as well as four individuals, Defendants Jayson Koss
1
Defendants, Delivery Dudes, LLC, Delivery Dudes Franchise Systems, LLC, and Dude
Holdings, LLC’s Motion to Dismiss or, Alternatively, Motion for More Definite Statement, ECF
No. [23], merely seeks to join in the arguments presented by Defendant Jayson Koss in his
Motion to Dismiss and, Alternatively, Motion for More Definite Statement, ECF No. [12].
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(“Koss”), Ryan Sturgis (“Sturgis”), Michael Silverman (“Silverman”), and Austin Rappaport
(“Rappaport”) (the “Individual Defendants”) (collectively, “Defendants”), for minimum wage
and overtime violations cognizable under the provisions of the Fair Labor Standards Act, 29
U.S.C. § 201 et seq. (“FLSA”). See generally Complaint (“Compl.”), ECF No. [1]. According
to Plaintiff, “Defendants” engage in a food-delivery business, employing fifty to sixty drivers
who work regular schedules, wear uniforms, and are dispatched from a central location. Id. at ¶
1. Drivers are paid fifty cents per delivery and often work as much as fifty to sixty hours per
week. Id. at ¶ 3. Further, Plaintiff alleges that “Defendants engage in interstate commerce by
using the instrumentalities of commerce, including but not limited to processing credit card
transactions, [as well as] use of the telephone and internet.” See id. at ¶ 15. Plaintiff was
purportedly one such employee. See id. at ¶¶ 2, 14, 16-17.
Plaintiff asserts that he commonly worked a shift from 4:00 p.m. to 11:00 p.m., during
which he would make six to seven deliveries at fifty cents per delivery. Id. at ¶¶ 18-20. Thus,
Plaintiff would make approximately one delivery per hour, rendering an hourly wage of fifty
cents per hour. See id. at ¶¶ 20-21. Like other drivers, Plaintiff utilized his own vehicle for
deliveries, did not control his schedule, and was obligated to wear a uniform and make those
deliveries assigned to him through a central dispatching system located at “Defendants’
headquarters.” Id. at ¶¶ 24-29. Consequently, Plaintiff maintains that he was an employee of
“Delivery Dudes, LLC.” Id. at ¶ 30. Based on “Defendants’” pay procedures, Plaintiff contends
that Defendants have knowingly and willfully engaged in illegal minimum wage and overtime
practices, in violation 29 U.S.C. §§ 206 and 207 of the FLSA. See id. at ¶¶ 42-50. Defendants
Koss and the Corporate Defendants now seek dismissal pursuant to Federal Rule of Civil
Procedure 12(b)(6). See generally Motions.
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II. LEGAL STANDARD
Rule 8 of the Federal Rules requires a pleading to contain “a short and plain statement of
the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Although a
complaint “does not need detailed factual allegations,” it must provide “more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 555 (2007); see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(explaining that Rule 8(a)(2)’s pleading standard “demands more than an unadorned, thedefendant-unlawfully-harmed-me accusation”). In the same vein, a complaint may not rest on
“‘naked assertion[s]’ devoid of ‘further factual enhancement.’” Iqbal, 556 U.S. at 678 (quoting
Twombly, 550 U.S. at 557 (alteration in original)). These elements are required to survive a
motion brought under Rule 12(b)(6) of the Federal Rules of Civil Procedure, which requests
dismissal for “failure to state a claim upon which relief can be granted.”
When reviewing a motion under Rule 12(b)(6), a court, as a general rule, must accept the
plaintiff’s allegations as true and evaluate all plausible inferences derived from those facts in
favor of the plaintiff. See Chaparro v. Carnival Corp., 693 F.3d 1333, 1337 (11th Cir. 2012);
Miccosukee Tribe of Indians of Fla. v. S. Everglades Restoration Alliance, 304 F.3d 1076, 1084
(11th Cir. 2002); AXA Equitable Life Ins. Co. v. Infinity Fin. Grp., LLC, 608 F. Supp. 2d 1349,
1353 (S.D. Fla. 2009) (“On a motion to dismiss, the complaint is construed in the light most
favorable to the non-moving party, and all facts alleged by the non-moving party are accepted as
true.”). Accordingly, a court considering a Rule 12(b) motion is generally limited to the facts
contained in the complaint and attached exhibits, including documents referred to in the
complaint that are central to the claim. See Wilchombe v. TeeVee Toons, Inc., 555 F.3d 949, 959
(11th Cir. 2009); Maxcess, Inc. v. Lucent Technologies, Inc., 433 F.3d 1337, 1340 (11th Cir.
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2005) (“[A] document outside the four corners of the complaint may still be considered if it is
central to the plaintiff’s claims and is undisputed in terms of authenticity.”) (citing Horsley v.
Feldt, 304 F.3d 1125, 1135 (11th Cir. 2002)).
However, although a court is required to accept all of the allegations contained in the
complaint and exhibits attached to the pleadings as true, this tenet is inapplicable to legal
conclusions. Iqbal, 556 U.S. at 678; Thaeter v. Palm Beach Cnty. Sheriff’s Office, 449 F.3d
1342, 1352 (11th Cir. 2006). The Supreme Court has stated that courts “are not bound to accept
as true a legal conclusion couched as a factual allegation.” Twombly, 550 U.S. at 555.
III. DISCUSSION
Defendants Koss and the Corporate Defendants challenge the adequacy of Plaintiff’s
assertions on several bases, namely, that Plaintiff fails to allege sufficient facts to establish either
enterprise or individual coverage under the FLSA, that Defendants are joint enterprises or joint
employers, and that Defendant Koss acted as an “employer” as defined by the FLSA. See
generally Motion.
A.
Enterprise and Individual Coverage under the FLSA
The FLSA provides for two forms of coverage, individual coverage and enterprise
coverage. Thorne v. All Restoration Servs., Inc., 448 F.3d 1264, 1265-66 (11th Cir. 2006)
(“Under FLSA, an employer is required to pay overtime compensation if the employee can
establish enterprise coverage or individual coverage.”); Polycarpe v. E&S Landscaping Serv.,
Inc., 616 F.3d 1217, 1220 (11th Cir. 2010) (noting that “either individual coverage or enterprise
coverage can trigger the Act’s applicability”). “For individual coverage to apply under FLSA,
[the plaintiff] must [] provide[] evidence . . . that he was (1) engaged in commerce or (2)
engaged in the production of goods for commerce.” Thorne, 448 F.3d at 1266 (citing 29 U.S.C.
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§ 207(a)(1)). On the other hand, “[a]n employer falls under the enterprise coverage section of
the FLSA if it 1) ‘has employees engaged in commerce or in the production of goods for
commerce, or that has employees handling, selling, or otherwise working on goods or materials
that have been moved in or produced for commerce by any person’ and 2) has at least $500,000
of ‘annual gross volume of sales made or business done.’” Polycarpe, 616 F.3d at 1220 (quoting
29 U.S.C. § 203(s)(1)(A)).
“The question of enterprise coverage implicates both the Court’s jurisdiction and the
merits of the case.” Vignoli v. Clifton Apartments, Inc., 930 F. Supp. 2d 1342, 1345 (S.D. Fla.
2013) (citing Gonzalez v. Old Lisbon Restaurant & Bar, LLC, 820 F. Supp. 2d 1365, 1367 (S.D.
Fla. 2011)). When a party questions the viability of a plaintiff’s claim of enterprise coverage, the
“the Court should find it has jurisdiction and deal with the question as an attack on the merits of
the case.” Id. (citation omitted). Defendants contend that Plaintiff’s allegations concerning both
individual and enterprise coverage are either conspicuously absent, or minimalist and
conclusory. Viewing the allegations through the lens of Rule 12(b)(6), the Court agrees.
As noted, individual coverage requires an employee to show that he was either “(1)
engaged in commerce or (2) engaged in the production of goods for commerce.” Thorne, 448
F.3d at 1266 (citing 29 U.S.C. § 207(a)(1)). The “engaged in commerce” requirement is satisfied
where the employee “directly participat[es] in the actual movement of persons or things in
interstate commerce by (i) working for an instrumentality of interstate commerce . . . or (ii) by
regularly using the instrumentalities of interstate commerce in his work.” Scott v. K.W. Max
Investments, Inc., 256 F. App’x 244, 248 (11th Cir. 2007) (quoting Thorne, 448 F.3d at 1266).
Plaintiff’s sole allegation related to this requirement is that “Defendants engage in interstate
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commerce by using the instrumentalities of commerce, including but not limited to processing
credit card transactions, [as well as] use of the telephone and internet.” See Compl. at ¶ 15.
Courts have repeatedly held that the mere processing of credit cards, without more, is
insufficient to constitute individual coverage, even at the pleading stage. See Mayo v. Jean
Nicole Hair Salons, Inc., No. 2:15-CV-115-FTM, 2015 WL 4751202, at *3 (M.D. Fla. Aug. 11,
2015) (holding that “merely using a customer’s credit card to ring up the sale does not constitute
interstate commerce,” particularly where the subject of the transaction was performed locally)
(citation omitted); Schamis v. Josef’s Table, LLC, No. 12-80638-CIV, 2014 WL 1463494, at *4
(S.D. Fla. Apr. 15, 2014) (finding allegations did not demonstrate engagement in commerce
based on, inter alia, processing credit card transactions for goods purchased locally);
Marckenson v. LAL Peker, LLC, No. 1:11-CV-22617-KMM, 2011 WL 5023422, at *4 (S.D. Fla.
Oct. 19, 2011) (granting motion to dismiss where the plaintiff “failed to produce any evidence
indicating that by merely processing credit cards for goods purchased locally he was engaging in
interstate commerce”); see also Joseph v. Nichell’s Caribbean Cuisine, Inc., 862 F. Supp. 2d
1309, 1313 (S.D. Fla. 2012), as amended (July 17, 2012) (“Usage of credit cards is insufficient
for purposes of establishing FLSA individual coverage.”) (citation omitted). Similarly, the mere
use of a telephone or the Internet does not evidence regular use of the instrumentalities of
interstate commerce. Cf. Lefevre v. La Cote Basque Winehouse, Inc., No. 8:15-CV-1428-T23TBM, 2015 WL 6704107, at *1 (M.D. Fla. Nov. 3, 2015) (use of “interstate telephone”
sufficient to establish individual coverage). Plaintiff does not allege that he utilized these
purported instrumentalities to communicate with out-of-state customers in any fashion but,
rather, simply alleges that he used them in general. See generally Ceant v. Aventura Limousine
& Transp. Serv., Inc., 874 F. Supp. 2d 1373, 1378 (S.D. Fla. 2012) (noting that a plaintiff must
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simply “provide [] straightforward allegations connecting that work to interstate commerce”
(emphasis supplied)). Merely because an instrumentality may be used in interstate commerce,
does not mean the instrumentality is used in interstate commerce (for instance, a telephone may
be used to call locally, or to call across state lines). The Commerce Clause is not so unbridled as
to apply to all transactions that potentially implicate interstate commerce but, in reality, do not.
See generally Navarro v. Broney Auto. Repairs, Inc., 533 F. Supp. 2d 1223, 1226 (S.D. Fla.
2008) aff’d, 314 F. App’x 179 (11th Cir. 2008) (“The phrase ‘engaged in commerce’ reflects
Congress’s intent to regulate ‘only activities constituting interstate commerce, not activities
merely affecting commerce.’” (quoting Thorne, 448 F.3d at 1266)).
Furthermore, such a
threadbare recitation lacking factual enhancement is insufficient under the standard elucidated in
Iqbal. 556 U.S. at 678 (“Threadbare recitals of the elements of a cause of action, supported by
mere conclusory statements, do not suffice.”).2
Because Plaintiff fails to adequately plead the “engaged in commerce” requirement,
allegations establishing enterprise coverage are also lacking. See Polycarpe, 616 F.3d at 1220
(stating that enterprise coverage applies where an employer “has employees engaged in
2
Plaintiff cites Gonzalez v. Unidad of Miami Beach, Inc., No. 11-20649-CIV, 2011 WL 2983671
(S.D. Fla. July 22, 2011), in support of his argument, believing that the Court in Gonzalez relied
on a specific paragraph of the complaint to determine that the plaintiff had adequately alleged
that defendants were engaged in interstate commerce. See Plaintiff’s Response (“Pl. Resp.”),
ECF No. [29] at 5 n.20. The point raised provides a poignant comparison between the
allegations in the case sub judice and those ostensibly present in Gonzalez. The use of the
internet and telephonic transmissions to conduct business over state lines may support a
conclusion that an employee is “engaged in commerce.” Here, however, the Complaint is devoid
of such allegations.
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commerce . . .” (emphasis added)). Consequently, Plaintiff’s Complaint fails to plead facts
indicating that either individual coverage or enterprise coverage under the FLSA is appropriate.3
B.
Joint Enterprise Coverage
As with the lack of allegations establishing enterprise coverage, Plaintiff fails to present
allegations of a joint enterprise. Under the FLSA’s enterprise coverage, two businesses may be
considered a joint enterprise if they are sufficiently related, allowing several employers to be
simultaneously liable for the same FLSA violations.
Vignoli, 930 F. Supp. 2d at 1346 (citing
Gonzalez, 820 F. Supp. 2d at 1368). To allege a joint enterprise, a plaintiff must allege facts that
the businesses in question “(1) performed related activities, (2) through a unified operation or
common control, and (3) for a common business purpose.” Gonzalez, 820 F. Supp. 2d at 1368
(citing 29 C.F.R. § 779.202; Donovan v. Easton Land & Dev., Inc., 723 F.2d 1549, 1551 (11th
Cir. 1984)).
Plaintiff points to the single allegation that “Defendants employ [Plaintiff] as a driver,”
Compl. at ¶ 16, and asserts that it is sufficient to establish joint enterprise coverage. See Pl.
Resp. at 7. Even when drawing this allegation in the light most favorable to Plaintiff, it still falls
considerably short of what could reasonably be deemed a well-pled allegations and is more
appropriately considered a threadbare and conclusory accusation as to joint enterprise coverage.
The fact that the Corporate Defendants share a root name is equally unsatisfactory; the Corporate
3
In response, Plaintiff references exhibits not attached to the Complaint. See Pl. Resp. at 5. In
general, the Court does not consider any items beyond the face of the complaint and the
documents attached thereto when addressing a motion to dismiss. Fin. Sec. Assur., Inc. v.
Stephens, Inc., 500 F.3d 1276, 1284 (11th Cir. 2007) (citing Brooks v. Blue Cross & Blue Shield
of Fla., Inc., 116 F.3d 1364, 1368 (11th Cir. 1997)). The Eleventh Circuit provides an exception
where “a plaintiff refers to a document in its complaint, the document is central to its claim, its
contents are not in dispute, and the defendant attaches the document to its motion to dismiss.”
Id. (citing Harris v. Ivax Corp., 182 F.3d 799, 802 n.2 (11th Cir. 1999); Brooks, 116 F.3d at
1368-69). These exhibits are not referenced in the Complaint and, therefore, this exception is
inapplicable. Therefore, the Court declines to consider them.
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Defendants are distinct legal entities regardless of their common designations. By referencing
this lone allegation seemingly unrelated to any theory of joint enterprise, Plaintiff appears to
concede that the Complaint is bereft of any elements to establish a joint enterprise.4 Plaintiff’s
insistence that discovery is required to determine the corporate structure at work is immaterial
and, moreover, refuted by the assertions contained in Plaintiff’s Response where Plaintiff
includes various “facts” concerning the nature of the relationship between the parties. See Pl.
Resp. at 9. Although discovery will undoubtedly reveal a more intimate picture of the affiliation
between the parties, the Plaintiff is, nevertheless, obligated to introduce a modicum of factual
allegations, accepted as true, which allow for the conclusion that the various Defendants may be
simultaneously liable. See Gonzalez, 820 F. Supp. 2d at 1368. The unrestrained commingling of
both the Corporate Defendants and the Individual Defendants into a single reference,
“Defendants,” is improper without additional allegations establishing the propriety of the same.
B.
Joint Employers
An “employer” is defined by the FLSA as “any person acting directly or indirectly in the
interest of an employer in relation to an employee.” 29 U.S.C. § 203(d). An entity “employs” a
person under the FLSA if it “suffer[s] or permit[s]” the individual to work. Id. § 203(g). “[T]he
FLSA contemplates that a covered employee may file suit directly against an employer that fails
to pay him the statutory wage, or may make a derivative claim against any person who (1) acts
4
Plaintiff also asserts that the “network of LLCs satisfies [the definition of joint enterprise],”
because each of the Corporate Defendants “serves a purpose in furtherance of [the] business,”
and because the Individual Defendants are either managers or registered agents for the Corporate
Defendants.” See Pl. Resp. at 7. A plaintiff “may not amend his complaint through new
allegations raised when responding to a motion to dismiss.” Wennersten v. Commercial Diver
Servs., N.A. Inc., No. 12-60975-CIV, 2012 WL 3230419, at *1 n.1 (S.D. Fla. Aug. 6, 2012)
(citing Bruhl v. Price Waterhouse Coopers Int’l, No. 03–23044, 2007 WL 997362, at *4 (S.D.
Fla. Mar. 27, 2007; Walker v. City of Orlando, No. 07–651, 2007 WL 1839431, at *5 (M.D. Fla.
Jun. 26, 2007)).
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on behalf of that employer and (2) asserts control over conditions of the employee’s
employment.” Josendis v. Wall to Wall Residence Repairs, Inc., 662 F.3d 1292, 1298 (11th Cir.
2011) (citing Patel v. Wargo, 803 F.2d 632, 637-38 (11th Cir. 1986)). “In determining whether a
party is an employer, courts have long assessed the economic reality of the relationship between
the employee and the alleged employer.” Ceant, 874 F. Supp. 2d at 1381 (quoting Baltzley v.
Berkley Group, Inc., 2010 WL 3505104, at *3 (S.D. Fla. Sept. 3, 2010)). “The economic reality
test suggests an employee-employer relationship may exist where the alleged employer hires and
fires employees, supervises and controls employee work schedules or conditions of employment,
determines the rate and method of payment, or maintains employment records.” Id. (citation
omitted).
Review of the Complaint reveals that it is utterly lacking in any allegations which
concern the relationship between the various Defendants. As noted, Plaintiff promptly combines
the eight Defendants into one collective term, “Defendants,” without little explanation as to how
the entities and individuals are associated. In fact, Plaintiff incorporates a conflicting assertion,
stating that “[p]ut simply, [Plaintiff] is an employee of” one of the Corporate Defendants,
Defendant Delivery Dudes, LLC, but not the others. Compl. at ¶ 30. While Plaintiff does,
however, indicate that the Individual Defendants are the “owners and/or managers” of the
Corporate Defendants, see Complaint at ¶ 9, he fails to elaborate on that fact in any respect,
providing no facts that would allow for, at a minimum, an inference that certain Individual
Defendants have the authority to oversee day-to-day operations, play a supervisory role, etc.
Stated simply, this single allegation is conclusory and unsupported by pertinent factual
assertions. In Baltzley v. Berkley Group, Inc., 2010 WL 3505104 (S.D. Fla. Sept. 3, 2010), the
Court found the conclusion that each individual defendant was an employer to be supported by
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relevant factual assertions, to wit, that “each of the Individual Defendants regularly performed
acts of hiring and firing, setting work schedules, and controlling operations and finances of the
various Corporate Defendants.” Id. at *3. The Court also noted that the allegations “reflect[ed]
a modicum of individuation as to the Individual Defendants’” role. Id. In contrast, no such
allegations are included in Plaintiff’s Complaint.
Thus, the Complaint fails to adequately
advance a theory of joint employment and fails to allege how the Individual Defendants may be
held liable under the FLSA.5
IV. CONCLUSION
Plaintiff’s allegations are lacking in factual detail. As a result, dismissal is warranted.
However, the Supreme Court has instructed that “[i]n the absence of any apparent or declared
reason—such as undue delay, bad faith, or dilatory motive on the part of the movant, repeated
failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing
party by virtue of the allowance of the amendment, futility of amendment, etc.—[leave to
amend] should, as the rules require, be ‘freely given.’” Foman v. Davis, 371 U.S. 178, 182
(1962) (citing Fed. R. Civ. P. 15). Pursuant to Foman, Plaintiff shall be permitted to cure the
deficiencies outlined above. Plaintiff shall clarify those allegations concerning enterprise and
individual coverage, joint enterprise coverage, joint employer status, and individual liability as to
the purported corporate officers.
It is, therefore, ORDERED AND ADJUDGED that Defendant Jayson Koss’s Motion to
Dismiss and, Alternatively, Motion for More Definite Statement, ECF No. [12], and Defendants,
5
As with the majority of Plaintiff’s pleading requirements, Plaintiff once again embarks on a
vehement attack on Defendants’ assertions by referencing facts not present in the actual
pleading. Again, the Court advises Plaintiff that new allegations may not be raised in responding
to a motion to dismiss. Wennersten, 2012 WL 3230419, at *1 n.1. The case law concerning
joint liability for owners and directors under the FLSA may be ironclad; it is, however,
inapposite in light of Plaintiff’s austere allegations.
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Delivery Dudes, LLC, Delivery Dudes Franchise Systems, LLC, and Dude Holdings, LLC’s
Motion to Dismiss or, Alternatively, Motion for More Definite Statement, ECF No. [23], are
GRANTED. Plaintiff Justin Attai shall submit an amended pleading that complies with the
guidance provided in this Order on or before March 14, 2016.
DONE AND ORDERED in Miami, Florida this 2nd day of March, 2016.
____________________________________
BETH BLOOM
UNITED STATES DISTRICT JUDGE
Copies to:
Counsel of Record
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